Domenico De Sole

"In mid-February 1999, Pierre Godé and James Lieber, the group's attorney for sensitive affairs, met with Nicolas Waldmann in Paris, accompanied by Thomas Helsby, the head of Kroll Associates' London office. The objective of the meeting was to launch an investigation into Gucci as well as its two main leaders, Domenico De Sole and Tom Ford. A letter from Kroll, addressed to the leaders of LVMH, dated February 16th, was clear: "Your group currently holds a significant stake in a foreign company," Nicolas Waldmann wrote to Pierre Godé."

"Similarly, Kroll was commissioned by LVMH to obtain information on other competitors, such as Hermès, Versace, Ferragamo, or Armani. Regarding Domenico De Sole, the investigations that Kroll is conducting at the request of LVMH go far beyond9."

"But most importantly, on that same day, Domenico De Sole pulled an incredible rabbit out of his hat. Gucci announced the immediate issuance of 20 million new shares, exclusively reserved for employees, which reduced LVMH's stake from 34.4% to 25.6%! Called ESOP (Employee Stock Ownership Plan), this "employee share ownership plan" is a diabolical invention that uses the inexhaustible resources of Dutch corporate law to prevent LVMH from imposing its views without taking majority control of Gucci. Michel Zaoui, head of mergers and acquisitions in Europe for Morgan Stanley (the advisory bank for Guinness against Bernard Arnault), came up with the idea."

"The head of Kroll in France then specifies the areas of research he proposes to undertake. This includes "clarifying the management structure of the company and identifying its key personnel; collecting any information related to the compensation of the main decision-makers and, in particular, the conditions for granting stock options; evaluating the quality of professional relationships between the main leader of the company and its executives, as well as its shareholders and directors; establishing a detailed personal and professional profile (background, assets, sources of income, external activities, network of relationships, reputation, etc.) of Domenico De Sole and Tom Ford and, if applicable, noting any information concerning their professional integrity; obtaining any financial or commercial documents available on the company and its leaders in the appropriate jurisdictions; gathering any information useful for a thorough understanding of the company's activities (operations, licenses, etc.) in the main geographic areas where it generates the majority of its revenue and identifying any past or present problems related to its activities; attempting to identify the strategy envisaged by your opponents in the context of ongoing negotiations." The initial budget is 500,000 francs (76,224 euros) excluding taxes."

"Time is running out. Domenico De Sole and Michel Zaoui from Morgan Stanley know how fragile the more or less fictitious allocation of shares to employees is, which reduces LVMH's stake in Gucci from 34.4% to 25.6%."